Frasers’ logistics trust buys Melbourne and Thames Valley investments, sells half stake of Brisbane facility

IVE Group rents two factories within Braeside Industrial Estate. It only agreed to lease the second this quarter.

Frasers Logistics & Commercial Trust will pay its parent Frasers Property $91.6 million (S$89.9m) for an industrial investment in Melbourne and a high-tech business park in the Thames Valley (pictured, top), about 60 kilometres west of London.

Today, we reported Frasers Property Industrial , which secured IVE Group to the Braeside asset Frasers Logistics & Commercial Trust is buying, pre-committed Ozito Industries to an even bigger Dandenong South factory (outlined), about nine kilometres east.

The Singapore listed fund also announced today it is selling its remaining half stake in a Coles-leased cold storage distribution facility at 99 Sandstone Place, Parkinson, south of Brisbane, to DWS for $152.5m – a 12.2 per cent premium over the July 31 book value (and a little more – $18.3m – than the price it offloaded the other 50pc for, to the same buyer, last June).

Trust chief executive officer, Robert Wallace, said “the divestment is in-line with our active asset management strategy, enabling FLCT to unlock value from the sale property at an attractive premium, with the…proceeds providing [it] with greater financial flexibility”.

The acquisitions, he added, are a “strategic fit” for the portfolio “being modern and high quality properties with excellent connectivity and strong tenants”.

“It further entrenches FLCT in two attractive markets”.

Following the proposed purchase and sale, the portfolio will comprise some 2.6m square metres within 100 properties worth a total of about $6 billion.

The Braeside and Bracknell properties

The Melbourne asset is new – part of Fraser Property Industrial’s Braeside Industrial Estate, which has been taking shape for a year (story continues below).

Tenanted until 2025 to IVE Group (which coincidentally committed to a second factoty there, last month), it contains 14,263 sqm of area and is costing $22.5m.

JLL’s Tony Iuliano and Adrian Rowse were the marketing agents.

The UK asset, Maxis Business Park, is in Bracknell – which FLCT added is the largest regional economy outside of London.

Accessed from London’s Waterloo, the contemporary office contains 17,869 sqm of area and serves as the regional headquarters for several large businesses including Allegis Group Ltd, Cadence Design Systems and Panasonic UK.

“More than 60pc of the tenants of the UK property are in the technology and telecommunication sectors, further adding to the resilience of the UK Property,” Mr Wallace said.

“Despite the COVID-19 pandemic, the UK business park market continues to have active leasing taking place with approximately 63,000 sqm of take up in the first half of 2020 and the top three largest deals which took place in the second quarter of 2020 were leased to technology companies such as Hewlett Packard.

“The UK business park sector is expected to remain as an attractive and resilient asset class within the commercial space in the long run”.

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Marc Pallisco

A former property analyst and journalist, Marc is the publisher of realestatesource.com.au.

Marc Pallisco